Cold Storage Business in Nepal: A Profitable High-ROI Opportunity

Cold Storage Business in Nepal: A Profitable High-ROI Opportunity

Investing in cold storage can present highly profitable, sustainable, and significant economic opportunities due to the increase in consumer demand, government subsidies, and contemporary refrigeration technology. The good news is that our country Nepal, produces a large volume of perishable items such as meat, dairy products, and vegetables. To ensure their quality and reduce post-harvest losses, the Cold Storage Business operates to preserve these perishable goods. Because of this relation, Cold Storage Business has now become a business with high ROI opportunity in Nepal. 

In this blog, we provide insights regarding the cold storage business in Nepal, reasons to start the business, and its step-wise process. Along with it, we also give information regarding tips to maximize the profit in the cold storage business, how to apply for subsidies, and reasons to choose Nepcool for the cold storage business.

Overview of the Cold storage business in Nepal

Cold storage business is a type of business that provides temperature-controlled storage facilities for perishable goods so that the goods are fresh and preserved for a longer period of time. The perishable goods contain fruits, vegetables, meat, seafood, and dairy products. Nowadays, it has been emerging as one of the great investment opportunities in Nepal. With the growing demand for quality food preservation, the cold storage sector holds great potential for sustainable growth and profitability. Maintaining a suitable temperature inside the cold storage can help in reducing post-harvest losses and stabilizing prices. In recent days, the rising urbanization, changing consumption habits, and the growth of supermarkets, dairy industries, and food processing units have further increased the need for cold storage across the country. Therefore, the government of Nepal has provided various subsidies to encourage private investment to invest some amount of money in this sector. As a result, it is now becoming a high-ROI business opportunity. 

Reasons to start a Cold storage business

There are several reasons to start a cold storage business. One of them includes the high demand and growing market. As the consumption of frozen meats, dairy items, vegetables, and pharmaceuticals is rising, there is a high demand for cold storage businesses in the market. Moreover, some of the additional reasons to start a cold storage business are listed below: 

• Reduction in post-harvest losses: There is a great deterioration in the agriculture sector (around 20% - 40%). To protect from deterioration, the cold storage room helps by maintaining the ideal temperature and humidity, enhancing the shelf life of the items. 
• Government support and subsidies: The government of Nepal has given several subsidies and organized grant programs to give priority to the cold storage business. They also encourage private investment in this sector. To open the cold storage business, the government can give loans at low interest and financial assistance. 
• Long-term and stable ROI: The cold storage business offers consistent revenue streams through rental and service charges. With the help of proper management and investment, businesses can foster long-term relationships and achieve the goal (high ROI).
• Technological advancement: As the technology has advanced, cold storage contains many modern features such as energy-efficient refrigeration, solar-powered systems, and IoT-based temperature monitoring that helps in reducing operational costs and increasing reliability. By using these technologies, you can make your business more profitable.
• Opportunity to empower farmers and local economies: By using the cold storage room, farmers can preserve the crops for a long period of time and sell these crops when the prices are high. This can help them in generating profits. 

How to start a cold storage business

To start a cold storage business, you need to follow the step-wise process. By applying these processes, you can establish well-organized and efficient cold storage businesses. Furthermore, you can also meet the industry standard and customer expectations by following these processes. The process includes:

• Conduct market research: The first step to start a cold storage business is to conduct market research. Identify the demand for cold storage in your nearby places. Then, analyze the types of perishable goods produced. After that, study your potential competitors and know their weaknesses and gaps. Then, estimate the revenue, cost, and ROI.
• Choose a strategic location: For a cold storage business, it is better to choose a place that is located near the agriculture hubs. If you choose there, you can minimize the transportation cost. Additionally, ensure the place where there is access to roads and logistics networks. While deciding the place, you should also check the availability of electricity and water supply, as it is important for the refrigeration system.
• Decide the type and scale of facility: After selecting the location, you need to decide which type and facility should be there before opening the cold storage business. While preparing a business plan, you should be careful regarding capital requirements, operational expenses, revenue projections, and ROI estimates. Furthermore, you also need to define services offered, such as storage, packaging, ripening, and freezing. To run the business, get a partnership with farmers, suppliers, and retailers.
• Acquire legal approvals and licenses: After preparing a cold storage business plan, the next step you need to follow is to get the legal approvals and licenses from the government of Nepal. To do that, you must register your company with the Office of the Company Registrar, or OCR. Then, obtain an agriculture and industrial license from the Department of Agriculture or local authorities. If the products must be stored, you should also adhere to food safety and hygiene regulations.
• Design and construct the facility: Once you fulfill all the legal requirements for your cold storage business in Nepal, you need to start working on it. It is important to hire experienced engineers and consultants for designing the layout and refrigeration. You also need to set the suitable temperature and ideal humidity to preserve the different kinds of products. Do note that it is better to have an energy-efficient refrigeration system to reduce operational costs.
• Purchase equipment and install technology: In order to efficiently run the cold storage business, you can buy the best equipment such as refrigerators, insulation, pallet racks, and monitoring systems. Moreover, incorporate the latest technology such as IoT-based temperature and humidity sensors to automate and enhance efficiency. For seamless functioning, the equipment should have backup power sources.
• Hire and train staff: After you purchase the equipment and install the latest technology, the next step is to hire and train the staff. It is important to hire refrigeration professionals, facility managers, and warehouse operators for cold storage in Nepal. Additionally, the warehouse operators should be trained well enough regarding safety protocols, proper handling of perishable goods, and record-keeping.
• Establish supply chain and client partnership: To maintain better supply chain management, you need to collaborate with the farmers, cooperatives, wholesalers, and retailers. You also need to offer contracts or subscription-based storage plans for better partnerships with the clients and for steady income.
• Marketing and launch: It is crucial to promote your facility through regional agricultural networks, trade exhibitions, and digital marketing after establishing supply chain and client partnership. You need to offer value-added services such as packaging, freezing, and shipping for enhanced customer convenience.
• Monitor and optimize operations: Monitor and optimize operations: Monitoring and optimizing the operations are the last steps for the cold storage industry. While observing, you have to monitor the storage capacity, energy usage, and the satisfaction of customers for enhancing better. For efficiency assurance, optimize the operation by conducting inventory management and maintenance. Do note that, you have to adjust the price, services, and operation processes on the basis of demand and seasonality.

Tips to maximize profit in the Cold storage business

Once you start your cold storage business, you may also think about how to maximize the profit in this business. Well, we are here to provide the information regarding this. You can increase the profit by applying many different cold storage business ideas. Some of the ideas are listed below: 

• Offer value-added services: To generate more profit, you need to offer services that are beyond basic storage. You need to provide ripening chambers, freezing, packaging, and sorting services. Along with it, you need to offer transportation or a last-mile delivery facility to clients.
• Build long-term partnership: The other tips to maximize the profit are to foster long-term relationships. Perform consistent collaboration with the farmers cooperatives, retailers and wholesalers and exporters, and logistics companies for the good income generation. 
• Maintain strict quality and hygiene standards: To build customer trust and long-term contracts, which directly help your business generate high ROI, it is necessary to maintain the quality and hygiene of perishable goods. For that, you need to regularly sanitize and monitor the cold storage room. It is important to perform maintenance time and again to preserve and maintain the quality of the product.
• Offer flexible pricing packages: To foster long-term relationships with potential customers and to generate income, you need to offer discounts and conduct loyalty programs. 
• Leverage government subsidies and incentives: The final tip to maximize profit is to ask the subsidies and incentives from the government. By doing this, you shouldn't have to spend a lot of money on your business. This can directly boost your profitability. 

How to apply for the Nepal cold storage business subsidy?

If you are planning to get the subsidy for cold storage in Nepal, you need to follow the steps below. These steps include various processes that help you get enough subsidies that are needed for your cold storage businesses. Before applying for a subsidy, it is mandatory to prepare a report. The process includes are listed below: 

• Most subsidies require a loan from a nationalized bank. During a loan application, submit the report and other documents to the bank. 
• Once the loan is approved, the bank automatically sends your application for a subsidy. There, you need to fill out the data sheet. 
• Then, you need to submit the documents to the state mission. 
• After that, the committee of state level selects the main object. 
• Then, the project becomes ready for technical compliance. 
• Once the technical compliance is finished, you can claim the subsidy.

Why Choose NepCool for Your Cold Storage Business?

Choosing the best partner for your cold storage business is important as it helps your business to increase efficiency, reliability, and profitability. Additionally, selecting the right partner can also ensure smooth operations, access to technical expertise, timely maintenance, and long-term business growth. If you are looking for such a partner, Nepcool is one of the best. It is because: 

• Expertise and Experience: Nepcool has years of experience in building and maintaining cold storage in Nepal. It is done with the help of experienced people. 
• Customized solutions: This organization offers custom cold storage solutions for farmers, warehouses, and specialized products like dairy and cream, meat, and agriculture. 
• Advanced technology: Our team uses modern refrigeration, energy-efficient equipment, and an IoT monitoring system to keep the perishable items safe and quality. 
• Cost-effective and energy-efficient: Nepcool uses cost-effective methods by using energy-efficient designs, solar systems, and smart layouts. This can boost a huge amount of ROI. 
• End-to-End Support: Our team offers support from the initial phase, designing, to the last phase, installation, maintenance, and training. Additionally, this company also helps you with government subsidies and approvals.

Conclusion

The cold storage business offers a high opportunity for ROI because of the growing agricultural production, limited storage infrastructure, and rising demand from farmers and retailers. Each year, some amount of perishable goods is wasted. Therefore, reliable cold storage facilities are emerging in high demand from farmers, distributors, and food processing industries. Additionally, to reduce post-harvest losses and generate more profit by leveraging modern, and energy-efficient refrigeration systems. With the help of proper management, strategic location, and strong partnerships, you can generate leads as well as sustain the venture. 

In this blog, we have provided the insights regarding the cold storage business in Nepal, reasons to start the business, and its step-wise process. Along with it, we have also given information regarding tips to maximize the profit in the cold storage business, how to apply for subsidies, and reasons to choose Nepcool for the cold storage business. If you want to know more about the cold storage in Nepal, choose Nepcool - one of the leading cold storage manufacturers in Nepal. 

FAQ on cold storage business

Why is the cold storage business considered a high ROI opportunity in Nepal?

The cold storage business is considered a high ROI opportunity in Nepal due to various factors that are listed below: 

• Growing Demand for Perishable Goods Storage
• Reduction of Post-Harvest Losses
• Government Support and Incentives
• Rising Urbanization and Changing Consumption Patterns
• Long-Term Business Sustainability

How much money can you receive as a subsidy?

The money you would receive as a subsidy depends on the program you organized. Some of them are listed below: 

• NPR 3,00,000 for the reconstruction of housing
• NPR 4,95,000 for category A, NPR 4,65,000 for category B, and NPR 4,30,000 for category C in renewable energy. 
• NPR 5,00,000 loan for agriculture
• 3-5% of the transaction value for exports

Is cold storage a profitable business?

Yes, the cold storage business is profitable in a country like Nepal. It is because: 

• High Demand for Perishable Goods Storage
• Diversified Revenue Streams
• Government Support
• Long-Term Sustainability
• Potential for High ROI

What types of cold storage facilities can I set up in Nepal?

You are allowed to set up any type of cold storage facility. While setting up, you need to target the market, investment capacity, and the type of product. Here are some of the types of cold storage facilities you can set up in Nepal. 

• Small-scale cold storage 
• Medium/Large-Scale Cold Storage
• Specialized Cold Storage
• Multi-Purpose Cold Storage
• Modular / Mobile Cold Storage